Baltimore American Ins. Co. v. Pecos Mercantile Co.

• Decision Date: 25 July 1941
• Docket Number: No. 2262.,2262.
• Parties: BALTIMORE AMERICAN INS. CO. OF NEW YORK v. PECOS MERCANTILE CO.
• Court: U.S. Court of Appeals — Tenth Circuit

122 F.2d 143 (1941)

BALTIMORE AMERICAN INS. CO. OF NEW YORK v. PECOS MERCANTILE CO.

No. 2262.

Circuit Court of Appeals, Tenth Circuit.

July 25, 1941.

COPYRIGHT MATERIAL OMITTED

Thornton Hardie, of El Paso, Tex. (A. K. Montgomery, of Santa Fe, N. M., and Allen R. Grambling, of El Paso, Tex., on the brief), for appellant.

Caswell S. Neal, of Carlsbad, N. M., for appellee.

Before PHILLIPS and BRATTON, Circuit Judges, and KENNAMER, District Judge.

BRATTON, Circuit Judge.

Pecos Mercantile Company sued the Baltimore American Insurance Company to recover on a policy of fire insurance covering a stock of merchandise, and furniture and fixtures at Carlsbad, New Mexico. Plaintiff prevailed and defendant appealed.

Error is assigned upon the denial of the application of the defendant for a continuance of the case, or in the alternative for a postponement of the trial for at least two weeks. The application was based upon inadequacy of time and opportunity for the attorneys representing the defendant to prepare the case for trial. The defendant was represented by two firms of attorneys of widely recognized ability, one in Texas, and the other in New Mexico. The fire occurred on April 29, 1940; the suit was instituted on August 16; and the answer was filed on September 5. On September 17 the case was set for trial on October 9; on September 18 the setting was vacated; and on October 3, after a hearing at which both parties were represented, the case was set for trial on October 15. The application was filed on the day the case came on for trial. It detailed facts which tended to show that, due to professional engagements and other circumstances which need not be enumerated, the attorneys in Texas had been afforded very little time and opportunity for preparation; and it also set out that a certain member of that firm had intended to prepare the case and be present at the trial but was unable to do so. However, a few days before the trial another member of the firm assumed the responsibility, attended the trial, and participated actively in it. The application also set out that, due to the intention of the member of the firm in Texas to make the preparation and attend the trial, the attorneys in New Mexico had not familiarized themselves with the issues involved and had not taken any action in respect to preparation for trial. Otherwise, no attempt was made to show that the attorneys in New Mexico did not have adequate time and opportunity to make all necessary preparation. An application for a continuance or postponement is addressed to the sound judicial discretion of the trial court, and the action taken thereon is not ground for reversal unless that discretion is abused. Sanders v. Hall, 10 Cir., 74 F.2d 399, certiorari denied, 295 U.S. 739, 55 S.Ct. 653, 79 L.Ed. 1686; Southern Kansas Stage Lines v. Gibson, 10 Cir., 87 F.2d 23; George v. Wiseman, 10 Cir., 98 F.2d 923. A defendant represented by two competent firms of attorneys cannot depend exclusively upon one of them to make all the necessary preparation for trial and, after a reasonable time has elapsed between the institution of the suit and the date of the trial, be heard to complain at the denial of an application for continuance based solely upon the ground that such firm did not have sufficient time and opportunity for that purpose. There was no abuse of discretion in the denial of the application.

Complaint is made that the court declined to exclude the witnesses from the court room while not testifying. The court stated that it was not the practice to exclude witnesses, unless some special reason be shown; and inquiry was made whether there was any special reason, to which the defendant replied in general terms that the exclusion of the witnesses was desired. The question of the sequestration of witnesses rests in the sound discretion of the trial court. Latses v. United States, 10 Cir., 45 F.2d 949; Reger v. United States, 10 Cir., 46 F.2d 38; Hood v. United States, 8 Cir., 23 F.2d 472, certiorari denied, 277 U.S. 588, 48 S.Ct. 436, 72 L.Ed. 1002; Tinkoff v. United States, 7 Cir., 86 F.2d 868, certiorari denied, 301 U.S. 689, 57 S.Ct. 795, 81 L.Ed. 1346. No abuse of discretion is shown here.

The testimony of S. A. Taylor concerning the value of the fixtures in the dry goods department is challenged on the ground of being hearsay. Taylor testified that with one or two minor exceptions the fixtures in that department were purchased from the Weber Showcase Company of Los Angeles, California, in 1929; that he first became connected with the plaintiff in 1932; that he became its president in 1936, and had continued in that relationship ever since; that the company had an inventory of the furniture and fixtures; that it was completely destroyed by the fire; that he received from Weber Showcase Company duplicate invoices and other information concerning the fixtures purchased from it for the dry goods department, and information from Burroughs Adding Machine Company in respect to the replacement value of certain bookkeeping and adding machines; and that after such invoices and information had been received, a complete inventory was made including prices. The invoices were not introduced in evidence; but by reference to the inventory, Taylor testified in detail concerning the fixtures in the three departments of the store, dry goods, grocery, and market, also the equipment in the beauty shop and the furniture in the office. His testimony covered the items constituting the fixtures, the equipment, and the furniture, and their respective values. He testified that the total cost was $32,425.90; that the replacement cost would have been $30,000; that in submitting the proof of loss he took a depreciation of 44.7 per cent; and that, excluding certain personal property in the building but not owned by the company concerning which there is no controversy as to value, the furniture and fixtures were included in the proof of loss at $14,233.73. At the time Taylor acquired an interest in the business, all furniture and fixtures were carried on the books at a value of $31,526.64. On January 31, 1934, they were given a depreciated value of $14,533.23, and thereafter annual reductions of five per cent or more were made for depreciation. Some fixtures in the other departments were subsequently acquired from time to time. The entire furniture and fixtures appeared on the books of the company as of January 31, 1940, at a value of $14,233.73. The policy required the company to make monthly reports of the value of the property in the store. The reports for several months preceding the fire showed the inventory on hand, and they included the furniture and fixtures at the value shown on the books of the company. Taylor owned all of the capital stock of the corporation and, therefore, was the beneficial owner of the merchandise, fixtures, and equipment. He was president of the corporation, was active in the business, and was thoroughly familiar with it. He had personal knowledge of the fixtures, including their kind, utility, adaptability and condition. He testified in response to direct questions that he based his testimony as to cost and replacement values solely upon the duplicate invoices and information furnished him. But it is fairly apparent from his testimony as a whole that he took into consideration his ownership of the property, his active connection with the business, and his personal knowledge of the fixtures in respect to kind, utility and condition.

Of course, it is the general rule that hearsay evidence is inadmissible. The rule applies to both oral testimony and writings. Union Pacific Railroad Co. v. Perrine, 8 Cir., 267 F. 657. And oral testimony based exclusively upon writings which themselves come within the hearsay rule is not competent. Burn & Crump v. Metropolitan Lumber Co., 94 Conn. 1, 107 A. 609; G. A. Boeckling Co. v. Schwer, 122 Ohio St. 40, 170 N.E. 648; Lusardi v. Prukop, 116 Cal.App. 506, 2 P.2d 870; Taylor v. McLennan County, Tex.Civ.App., 120 S.W.2d 134. Moreover, one is required to produce the best evidence available, but where original invoices, inventories, books or other records have been destroyed by fire, resort may be had in a suit of this kind to duplicates, bank records, or other like evidence which is the best available. Cf. Connecticut Fire Insurance Co. v. Union Mercantile Co., 161 Ky. 718, 171 S.W. 407; Connecticut Fire Insurance Co. v. Boydston, 173 Ark. 437, 293 S.W. 730.

Testimony in respect of the market value of personal property is admissible when based upon recognized current catalogues or price lists, Cliquot's Champagne, 3 Wall. 114, 18 L.Ed. 116; Morris v. Columbian Iron Works & Dry Dock Co., 76 Md. 354, 25 A. 417, 17 L.R.A. 851; Mutual Fire Insurance Co. v. Owen, 148 Md. 257, 129 A. 214; American Bonding Company v. Regents of University of Idaho, 11 Idaho 163, 81 P. 604; Hoffman v. State, 24 Okl.Cr. 236, 218 P. 176; American Eagle Fire Insurance Co. v. Lively, 142 Okl. 246, 286 P. 797; upon current market quotations contained in standard publications, Schroeder v. State, 210 Wis. 366, 244 N.W. 599, 250 N.W. 185, 87 A.L.R. 496, certiorari denied, 289 U.S. 757, 53 S.Ct. 794, 77 L.Ed. 1501; upon information obtained from others with knowledge and experience, Betts v. Southern...